Columbus Foods CEO: 'We’re trying to do for the meat business what craft beer did for the beer industry'

Not so long ago, says Columbus Manufacturing, Inc CEO Joe Ennen, ‘premium’ was just about taste and texture. Today’s consumers – Millennials in particular – have a somewhat broader definition, which encompasses how their food was made, who made it, how sustainable it is… and a bunch of other things that you can’t discern just from eating it.

“One of the biggest changes I’ve seen is that consumers are redefining what a premium brand is,” ​says Ennen, who sits at the helm of a company almost a century old that has constantly had to reinvent itself to stay ahead of the curve, while at the same time retaining its distinct heritage (San Francisco-based Columbus ​​was founded in 1917 by Italian immigrants as the San Francisco Sausage Company and is now the #1 Italian deli meat company west of Mississippi, a top 10 deli brand nationwide, and one of the fastest-growing players in the category).

“I’ve been in the food business since the late 80s and back then, premium was all about taste and texture, but Millennials today have a more holistic definition,” ​says Ennen, who held senior roles at Safeway, Frito-Lay, ConAgra Foods and Kellogg before joining Columbus in 2015.

“With meats, consumers are now thinking about how the animal was raised, how and where the product was made, about how clean the ingredients deck is as well as the taste, texture and quality of the products themselves.”​

We’ve seen great movement towards super premium products​

He adds: “It doesn’t matter what category you look at​, consumers are trading up; as you see more people buying organic produce and dairy, we are seeing the same thing happening in the meat market, with consumers increasing rebelling against the less than stellar product quality being offered to them in the middle of the market.​

“We’ve seen great movement towards super premium products like ours that are traditionally made with old world recipes and methods, so we’re trying to do for the meat business what craft beer did for the beer industry, which was a kind of reaction against these giant traditional brewers pouring tasteless swill down people’s throats.”​

Finocchiona​ is a Tuscan favorite known for its fennel notes. Goes well with Hoppy IPAs, Pinot Noir and Merlot, plus goat cheese, Gouda and mild hard cheeses like Grana Padano.

Hot Sopressata ​has hints of red chile and paprika that work well with aged Spanish cheeses like Mahon, crusty French bread, pickled sweet and spicy peppers and a glass of port or stout, says Columbus.

My question is how do we get this amazing product to people that wouldn’t touch it with a 10-foot bargepole ​

The success of brands like KRAVE and EPIC in the meat snacks category also shows that you can drive incremental growth to a mature category by attracting a new demographic, says Ennen, who explains that Columbus started out as a super-premium Italian cured meats business but now generates roughly half its revenues from traditional deli meats, ham, turkey, roast beef, and pastrami.

“What we’re doing is very similar to what KRAVE tried to do, which is reimagine the categories where we operate, to think about the consumer that is NOT being satisfied with the products on offer, or not shopping the category at all. My question is how do we get this amazing product to people that wouldn’t touch it with a 10-foot bargepole?​

“To many consumers, lunchmeat, for example, is just something they won’t eat, and we and others in the craft meat business are trying to re-introduce people to the fact that turkey can actually taste like turkey.”​

In 2015, house-made charcuterie was the #2 [appetizer] trend in the NRA culinary forecast ​

And so far, Columbus et al have been doing a pretty good job, he says: “In 2015 was a strong year for deli; sales were up 7% total across the US, and Italian deli led the growth in that segment –up around 12% - and much of it is being driven by the super-premium segment in which we are fortunate enough to compete.​

“In 2015, house-made charcuterie was recognized as the #2​ [appetizer] trend in the National Restaurant Association’s culinary forecast​​, and as you know, trends often flow from restaurants down into grocery retailing. Our ACV distribution is about 41% - almost half of US grocery - and we’re very pleased with our growth to date, we’ve delivered consistent year over year growth over the last 10 years.”​

“We’ve seen great movement towards super premium products like ours that are traditionally made with old world recipes and methods, so we’re trying to do for the meat business what craft beer did for the beer industry which was a kind of reaction against these giant traditional brewers pouring tasteless swill down people’s throats.”​

Joe Ennen, CEO, Columbus Manufacturing Inc​

Consumers who see you developing a subline of ‘natural products’ see you lack commitment ​

When it comes to ‘cleaning up’ labels, the industry is also undergoing seismic shifts, says Ennen, who says the historic strategy of introducing a ‘natural’ range distinct from your main offering may no longer play so well. If you believe in something, he says, how strong is that belief if it only applies to some of your products?

Founded by Italian immigrants Peter Domenici and Enrico Parducci in 1917 as the San Francisco Sausage Company, Columbus Foods celebrates its 100th anniversary next year, and is now the #1 Italian deli meat company west of Mississippi, a top 10 deli brand nationwide, and the “fastest-growing” player in the category, according to CEO Joe Ennen.

“We’re in the process of moving a significant portion of the deli business to antibiotic-free and a cleaner label; by the end of the year we’ll have over 50% of the deli business transitioned to antibiotic free and we will tackle the salami side in 2017. But we don’t see this as a sub-line, a ‘natural’ line, it’s fundamental to being a premium brand.​

“Consumers who see you developing a subline of ‘natural products’ see you lack commitment, it’s disingenuous ​[Columbus’ own ‘natural’ line has been discontinued on these grounds].

“It increases costs ​[Columbus has been able to clean up some labels owing to its use of high pressure processing, for example], but it’s the right thing to do. We have already begun eliminating sodium nitrite and sodium nitrate from our products... You’ll find some of these deli meats in Costco already, and more will be showing up on shelves throughout 2016… ​

“And we aren’t promising to make this change over the next 10 years; we will be substantially transitioned ​[this includes removing artificial colors, flavors and phosphates] by the end of 2017.”​

Non-GMO​

While the overall market won’t go nitrite/nitrate/antibiotic free overnight, most players are making moves in this direction, while we can also expect to see more clean-label commitments from big foodservice brands, he predicts.

Longer-term, Columbus is looking at securing non-GMO certifications, he says: “This will take time as we identify trusted partners who can certify that their livestock receives non-GMO feed.”​